Audit 343693

FY End
2024-06-30
Total Expended
$1.16M
Findings
20
Programs
11
Organization: Isd # 682 Roseau (MN)
Year: 2024 Accepted: 2025-02-25

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
524415 2024-003 Material Weakness Yes N
524416 2024-003 Material Weakness Yes N
524417 2024-003 Material Weakness Yes N
524418 2024-003 Material Weakness Yes N
524419 2024-004 Material Weakness Yes E
524420 2024-004 Material Weakness Yes E
524421 2024-004 Material Weakness Yes E
524422 2024-004 Material Weakness Yes E
524423 2024-005 Material Weakness - N
524424 2024-005 Material Weakness - N
1100857 2024-003 Material Weakness Yes N
1100858 2024-003 Material Weakness Yes N
1100859 2024-003 Material Weakness Yes N
1100860 2024-003 Material Weakness Yes N
1100861 2024-004 Material Weakness Yes E
1100862 2024-004 Material Weakness Yes E
1100863 2024-004 Material Weakness Yes E
1100864 2024-004 Material Weakness Yes E
1100865 2024-005 Material Weakness - N
1100866 2024-005 Material Weakness - N

Contacts

Name Title Type
JRKMX3MKEAB1 Tom Jerome Auditee
2184631471 Brian Opsahl Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the accompanying schedule of expenditures of federal awards (the Schedule) are reported under generally accepted accounting principles (U.S. GAAP). Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards includes the federal award activity of the Independent School District No. 682 under programs of the federal government for the year ended June 30, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Independent School District No. 682, it is not intended to and does not present the financial position, changes in net position or cash flows of the Independent School District No. 682.
Title: COMMODITY DISTRIBUTION Accounting Policies: Expenditures reported on the accompanying schedule of expenditures of federal awards (the Schedule) are reported under generally accepted accounting principles (U.S. GAAP). Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. Nonmonetary assistance is reported in the schedule at the fair market value of the commodities received and disbursed.
Title: PASS-THROUGH ENTITIES Accounting Policies: Expenditures reported on the accompanying schedule of expenditures of federal awards (the Schedule) are reported under generally accepted accounting principles (U.S. GAAP). Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. Pass-through entities listed above without a pass-through number use the same AL numbers as the federal grantors to identify these grants and have not assigned any additional identifying numbers.
Title: SUBRECIPIENTS Accounting Policies: Expenditures reported on the accompanying schedule of expenditures of federal awards (the Schedule) are reported under generally accepted accounting principles (U.S. GAAP). Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. During 2024, the District did not pass any federal money to subrecipients.

Finding Details

2024-003 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Special Tests & Provisions Criteria Per Uniform Guidance, by November 15th of each school year, the local education agency must verify the current free and reduced price eligibility of households from a sample of applications that it has approved for free and reduced price meals. Condition We noted the verification was not done by the due date and the District did not verify the correct amount of applications. Questioned Costs None Context The District did not verify the correct amount of free and reduced applications on hand as of October 1st. The District also did not prepare this verification by the November 15th due date. Cause The District does not have controls in place to ensure that students who receive a free or reduced meal qualify for the benefit. Effect The District did not verify the correct amount of applications by the required due date. Repeat Finding Yes. Prior Audit Finding 2023-004. Recommendation The District should implement policies and procedures for verifying free and reduced applications. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-003 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Special Tests & Provisions Criteria Per Uniform Guidance, by November 15th of each school year, the local education agency must verify the current free and reduced price eligibility of households from a sample of applications that it has approved for free and reduced price meals. Condition We noted the verification was not done by the due date and the District did not verify the correct amount of applications. Questioned Costs None Context The District did not verify the correct amount of free and reduced applications on hand as of October 1st. The District also did not prepare this verification by the November 15th due date. Cause The District does not have controls in place to ensure that students who receive a free or reduced meal qualify for the benefit. Effect The District did not verify the correct amount of applications by the required due date. Repeat Finding Yes. Prior Audit Finding 2023-004. Recommendation The District should implement policies and procedures for verifying free and reduced applications. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-003 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Special Tests & Provisions Criteria Per Uniform Guidance, by November 15th of each school year, the local education agency must verify the current free and reduced price eligibility of households from a sample of applications that it has approved for free and reduced price meals. Condition We noted the verification was not done by the due date and the District did not verify the correct amount of applications. Questioned Costs None Context The District did not verify the correct amount of free and reduced applications on hand as of October 1st. The District also did not prepare this verification by the November 15th due date. Cause The District does not have controls in place to ensure that students who receive a free or reduced meal qualify for the benefit. Effect The District did not verify the correct amount of applications by the required due date. Repeat Finding Yes. Prior Audit Finding 2023-004. Recommendation The District should implement policies and procedures for verifying free and reduced applications. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-003 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Special Tests & Provisions Criteria Per Uniform Guidance, by November 15th of each school year, the local education agency must verify the current free and reduced price eligibility of households from a sample of applications that it has approved for free and reduced price meals. Condition We noted the verification was not done by the due date and the District did not verify the correct amount of applications. Questioned Costs None Context The District did not verify the correct amount of free and reduced applications on hand as of October 1st. The District also did not prepare this verification by the November 15th due date. Cause The District does not have controls in place to ensure that students who receive a free or reduced meal qualify for the benefit. Effect The District did not verify the correct amount of applications by the required due date. Repeat Finding Yes. Prior Audit Finding 2023-004. Recommendation The District should implement policies and procedures for verifying free and reduced applications. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-004 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Eligibility Criteria Per Uniform Guidance, a child’s eligibility for free and reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child’s household to published income eligibility guidelines. Condition We requested a complete listing of students who received a free/reduced meal based off either an application submitted or being direct certified in FY24. However, the district was not able to provide such a listing due to employee turnover. We analytically compared 1 month of reimbursements of free meals to those students who should receive a free meal and we noted that we only have applications/direct certifications to support approximately 33% of the free meals served. Questioned Costs None Context The eligibility test was not able to be performed due to the District not having a complete listing of students who received a free or reduced meal in FY24. Cause The District does not have controls in place to ensure that all students who receive a free or reduced meal qualify for the benefit. Effect There is an increased risk of students receiving a benefit that they may not have been eligible for. Repeat Finding Yes. Prior Audit Finding 2023-005. Recommendation The District should implement policies and procedures to ensure all students who receive a free or reduced meal have a current and accurate application on file. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-004 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Eligibility Criteria Per Uniform Guidance, a child’s eligibility for free and reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child’s household to published income eligibility guidelines. Condition We requested a complete listing of students who received a free/reduced meal based off either an application submitted or being direct certified in FY24. However, the district was not able to provide such a listing due to employee turnover. We analytically compared 1 month of reimbursements of free meals to those students who should receive a free meal and we noted that we only have applications/direct certifications to support approximately 33% of the free meals served. Questioned Costs None Context The eligibility test was not able to be performed due to the District not having a complete listing of students who received a free or reduced meal in FY24. Cause The District does not have controls in place to ensure that all students who receive a free or reduced meal qualify for the benefit. Effect There is an increased risk of students receiving a benefit that they may not have been eligible for. Repeat Finding Yes. Prior Audit Finding 2023-005. Recommendation The District should implement policies and procedures to ensure all students who receive a free or reduced meal have a current and accurate application on file. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-004 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Eligibility Criteria Per Uniform Guidance, a child’s eligibility for free and reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child’s household to published income eligibility guidelines. Condition We requested a complete listing of students who received a free/reduced meal based off either an application submitted or being direct certified in FY24. However, the district was not able to provide such a listing due to employee turnover. We analytically compared 1 month of reimbursements of free meals to those students who should receive a free meal and we noted that we only have applications/direct certifications to support approximately 33% of the free meals served. Questioned Costs None Context The eligibility test was not able to be performed due to the District not having a complete listing of students who received a free or reduced meal in FY24. Cause The District does not have controls in place to ensure that all students who receive a free or reduced meal qualify for the benefit. Effect There is an increased risk of students receiving a benefit that they may not have been eligible for. Repeat Finding Yes. Prior Audit Finding 2023-005. Recommendation The District should implement policies and procedures to ensure all students who receive a free or reduced meal have a current and accurate application on file. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-004 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Eligibility Criteria Per Uniform Guidance, a child’s eligibility for free and reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child’s household to published income eligibility guidelines. Condition We requested a complete listing of students who received a free/reduced meal based off either an application submitted or being direct certified in FY24. However, the district was not able to provide such a listing due to employee turnover. We analytically compared 1 month of reimbursements of free meals to those students who should receive a free meal and we noted that we only have applications/direct certifications to support approximately 33% of the free meals served. Questioned Costs None Context The eligibility test was not able to be performed due to the District not having a complete listing of students who received a free or reduced meal in FY24. Cause The District does not have controls in place to ensure that all students who receive a free or reduced meal qualify for the benefit. Effect There is an increased risk of students receiving a benefit that they may not have been eligible for. Repeat Finding Yes. Prior Audit Finding 2023-005. Recommendation The District should implement policies and procedures to ensure all students who receive a free or reduced meal have a current and accurate application on file. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-005 FINDING Federal Program Education Stabilization Fund (AL 84.425) Special Tests- Wage Requirements Criteria Per Uniform Guidance, “All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141–3144, 3146, and 3147.)” Condition During review of the program expenditures, the District had several transactions that required them to obtain certified payrolls from contractors and we noted this was missed. Questioned Costs None Context During testing, we noted that the district paid one contractor $54,200 for demo and the re-construction of a sidewalk. We also noted that the district paid another contractor $15,855 for a new partition between 2 rooms, from which, $11,550 of this was for labor. Cause The District does not have controls in place to ensure that wage rate requirements are being followed. Effect Payments to contracted employees may not be in compliance with wage rate requirements. Repeat Finding No. Recommendation The District should implement policies and procedures to ensure all transactions that qualify for wage rate requirements are identified to ensure compliance. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-005 FINDING Federal Program Education Stabilization Fund (AL 84.425) Special Tests- Wage Requirements Criteria Per Uniform Guidance, “All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141–3144, 3146, and 3147.)” Condition During review of the program expenditures, the District had several transactions that required them to obtain certified payrolls from contractors and we noted this was missed. Questioned Costs None Context During testing, we noted that the district paid one contractor $54,200 for demo and the re-construction of a sidewalk. We also noted that the district paid another contractor $15,855 for a new partition between 2 rooms, from which, $11,550 of this was for labor. Cause The District does not have controls in place to ensure that wage rate requirements are being followed. Effect Payments to contracted employees may not be in compliance with wage rate requirements. Repeat Finding No. Recommendation The District should implement policies and procedures to ensure all transactions that qualify for wage rate requirements are identified to ensure compliance. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-003 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Special Tests & Provisions Criteria Per Uniform Guidance, by November 15th of each school year, the local education agency must verify the current free and reduced price eligibility of households from a sample of applications that it has approved for free and reduced price meals. Condition We noted the verification was not done by the due date and the District did not verify the correct amount of applications. Questioned Costs None Context The District did not verify the correct amount of free and reduced applications on hand as of October 1st. The District also did not prepare this verification by the November 15th due date. Cause The District does not have controls in place to ensure that students who receive a free or reduced meal qualify for the benefit. Effect The District did not verify the correct amount of applications by the required due date. Repeat Finding Yes. Prior Audit Finding 2023-004. Recommendation The District should implement policies and procedures for verifying free and reduced applications. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-003 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Special Tests & Provisions Criteria Per Uniform Guidance, by November 15th of each school year, the local education agency must verify the current free and reduced price eligibility of households from a sample of applications that it has approved for free and reduced price meals. Condition We noted the verification was not done by the due date and the District did not verify the correct amount of applications. Questioned Costs None Context The District did not verify the correct amount of free and reduced applications on hand as of October 1st. The District also did not prepare this verification by the November 15th due date. Cause The District does not have controls in place to ensure that students who receive a free or reduced meal qualify for the benefit. Effect The District did not verify the correct amount of applications by the required due date. Repeat Finding Yes. Prior Audit Finding 2023-004. Recommendation The District should implement policies and procedures for verifying free and reduced applications. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-003 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Special Tests & Provisions Criteria Per Uniform Guidance, by November 15th of each school year, the local education agency must verify the current free and reduced price eligibility of households from a sample of applications that it has approved for free and reduced price meals. Condition We noted the verification was not done by the due date and the District did not verify the correct amount of applications. Questioned Costs None Context The District did not verify the correct amount of free and reduced applications on hand as of October 1st. The District also did not prepare this verification by the November 15th due date. Cause The District does not have controls in place to ensure that students who receive a free or reduced meal qualify for the benefit. Effect The District did not verify the correct amount of applications by the required due date. Repeat Finding Yes. Prior Audit Finding 2023-004. Recommendation The District should implement policies and procedures for verifying free and reduced applications. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-003 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Special Tests & Provisions Criteria Per Uniform Guidance, by November 15th of each school year, the local education agency must verify the current free and reduced price eligibility of households from a sample of applications that it has approved for free and reduced price meals. Condition We noted the verification was not done by the due date and the District did not verify the correct amount of applications. Questioned Costs None Context The District did not verify the correct amount of free and reduced applications on hand as of October 1st. The District also did not prepare this verification by the November 15th due date. Cause The District does not have controls in place to ensure that students who receive a free or reduced meal qualify for the benefit. Effect The District did not verify the correct amount of applications by the required due date. Repeat Finding Yes. Prior Audit Finding 2023-004. Recommendation The District should implement policies and procedures for verifying free and reduced applications. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-004 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Eligibility Criteria Per Uniform Guidance, a child’s eligibility for free and reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child’s household to published income eligibility guidelines. Condition We requested a complete listing of students who received a free/reduced meal based off either an application submitted or being direct certified in FY24. However, the district was not able to provide such a listing due to employee turnover. We analytically compared 1 month of reimbursements of free meals to those students who should receive a free meal and we noted that we only have applications/direct certifications to support approximately 33% of the free meals served. Questioned Costs None Context The eligibility test was not able to be performed due to the District not having a complete listing of students who received a free or reduced meal in FY24. Cause The District does not have controls in place to ensure that all students who receive a free or reduced meal qualify for the benefit. Effect There is an increased risk of students receiving a benefit that they may not have been eligible for. Repeat Finding Yes. Prior Audit Finding 2023-005. Recommendation The District should implement policies and procedures to ensure all students who receive a free or reduced meal have a current and accurate application on file. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-004 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Eligibility Criteria Per Uniform Guidance, a child’s eligibility for free and reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child’s household to published income eligibility guidelines. Condition We requested a complete listing of students who received a free/reduced meal based off either an application submitted or being direct certified in FY24. However, the district was not able to provide such a listing due to employee turnover. We analytically compared 1 month of reimbursements of free meals to those students who should receive a free meal and we noted that we only have applications/direct certifications to support approximately 33% of the free meals served. Questioned Costs None Context The eligibility test was not able to be performed due to the District not having a complete listing of students who received a free or reduced meal in FY24. Cause The District does not have controls in place to ensure that all students who receive a free or reduced meal qualify for the benefit. Effect There is an increased risk of students receiving a benefit that they may not have been eligible for. Repeat Finding Yes. Prior Audit Finding 2023-005. Recommendation The District should implement policies and procedures to ensure all students who receive a free or reduced meal have a current and accurate application on file. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-004 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Eligibility Criteria Per Uniform Guidance, a child’s eligibility for free and reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child’s household to published income eligibility guidelines. Condition We requested a complete listing of students who received a free/reduced meal based off either an application submitted or being direct certified in FY24. However, the district was not able to provide such a listing due to employee turnover. We analytically compared 1 month of reimbursements of free meals to those students who should receive a free meal and we noted that we only have applications/direct certifications to support approximately 33% of the free meals served. Questioned Costs None Context The eligibility test was not able to be performed due to the District not having a complete listing of students who received a free or reduced meal in FY24. Cause The District does not have controls in place to ensure that all students who receive a free or reduced meal qualify for the benefit. Effect There is an increased risk of students receiving a benefit that they may not have been eligible for. Repeat Finding Yes. Prior Audit Finding 2023-005. Recommendation The District should implement policies and procedures to ensure all students who receive a free or reduced meal have a current and accurate application on file. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-004 FINDING Federal Program Child Nutrition Cluster (AL 10.553 & 10.555) Eligibility Criteria Per Uniform Guidance, a child’s eligibility for free and reduced price meals under a Child Nutrition Cluster program may be established by the submission of an annual application or statement which furnishes such information as family income and family size. Local education agencies determine eligibility by comparing the data reported by the child’s household to published income eligibility guidelines. Condition We requested a complete listing of students who received a free/reduced meal based off either an application submitted or being direct certified in FY24. However, the district was not able to provide such a listing due to employee turnover. We analytically compared 1 month of reimbursements of free meals to those students who should receive a free meal and we noted that we only have applications/direct certifications to support approximately 33% of the free meals served. Questioned Costs None Context The eligibility test was not able to be performed due to the District not having a complete listing of students who received a free or reduced meal in FY24. Cause The District does not have controls in place to ensure that all students who receive a free or reduced meal qualify for the benefit. Effect There is an increased risk of students receiving a benefit that they may not have been eligible for. Repeat Finding Yes. Prior Audit Finding 2023-005. Recommendation The District should implement policies and procedures to ensure all students who receive a free or reduced meal have a current and accurate application on file. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-005 FINDING Federal Program Education Stabilization Fund (AL 84.425) Special Tests- Wage Requirements Criteria Per Uniform Guidance, “All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141–3144, 3146, and 3147.)” Condition During review of the program expenditures, the District had several transactions that required them to obtain certified payrolls from contractors and we noted this was missed. Questioned Costs None Context During testing, we noted that the district paid one contractor $54,200 for demo and the re-construction of a sidewalk. We also noted that the district paid another contractor $15,855 for a new partition between 2 rooms, from which, $11,550 of this was for labor. Cause The District does not have controls in place to ensure that wage rate requirements are being followed. Effect Payments to contracted employees may not be in compliance with wage rate requirements. Repeat Finding No. Recommendation The District should implement policies and procedures to ensure all transactions that qualify for wage rate requirements are identified to ensure compliance. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.
2024-005 FINDING Federal Program Education Stabilization Fund (AL 84.425) Special Tests- Wage Requirements Criteria Per Uniform Guidance, “All laborers and mechanics employed by contractors or subcontractors to work on construction contracts in excess of $2,000 financed by federal assistance funds must be paid wages not less than those established for the locality of the project (prevailing wage rates) by the Department of Labor (DOL) (40 USC 3141–3144, 3146, and 3147.)” Condition During review of the program expenditures, the District had several transactions that required them to obtain certified payrolls from contractors and we noted this was missed. Questioned Costs None Context During testing, we noted that the district paid one contractor $54,200 for demo and the re-construction of a sidewalk. We also noted that the district paid another contractor $15,855 for a new partition between 2 rooms, from which, $11,550 of this was for labor. Cause The District does not have controls in place to ensure that wage rate requirements are being followed. Effect Payments to contracted employees may not be in compliance with wage rate requirements. Repeat Finding No. Recommendation The District should implement policies and procedures to ensure all transactions that qualify for wage rate requirements are identified to ensure compliance. Corrective Action Taken The District agrees with the recommendation and will review its policies and procedures.